MaxCyte, Inc.

Good day, and thank you for standing by. Welcome to the MaxSight Second Quarter Earnings Conference Call. At this time, all participants are in listening-only mode. At the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star 1-1-1. You will hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1-1. Today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Eric Abdaal, Ambassador to the Philippines. Please go ahead.

Good afternoon, everyone. Thank you for participating in today's conference call. Joining me on the call from MaxSight, we have Meher Masood, President and Chief Executive Officer, and Doug Swirsky, Chief Financial Officer. Earlier today, MaxSight released financial results for the second quarter ended June 30, 2025. A copy of the press release is available on the company's website. Before we begin, I need to read the following statement. Statements or comments made during this call may be forward-looking statements within the meaning of federal securities laws. Any statements contained in this call that relate to expectations or predictions of future events, results, or performance are forward-looking statements. Actual results may differ materially from those expressed or implied in any forward-looking statements due to a variety of factors which are discussed in detail in our SEC filings. Except as required by applicable law, the company has no obligation to publicly update any forward-looking statements, whether because of new information, future events, or otherwise. And with that, I will turn the call over to Mehar.

Thank you, Eric. Good afternoon, everyone, and thank you for joining MagSight's second quarter 2025 earnings call. Max High reported financial results that were in line with our expectations in the second quarter. To cover the highlights, we sustained growth in a difficult end market. We also recently signed two new strategic platform licenses with Anoka AB and Addis Abayo, bringing the total number of new SPLs this year to three. We continue to focus on investing in the business with discipline, while positioning the company to achieve profitability with our existing capital. And lastly, we've progressed well in the integration of SecureDX, which is a substantial long-term opportunity for MagSight. Despite what was a strong first half of the year, short-term external headwinds have begun to impact our expectations for growth in the second half. First, in recent months, we faced a decrease in spending on a large SPL partner customer related to PA inventory management and reorganization of manufacturing operations impacting leases. Second, we have seen some customers rationalize programs and wind down operations entirely. which has resulted in lower expectations for PA and licenses revenue. Last, we have seen continued capital equipment purchasing hesitancy from customers related to the uncertain funding and regulatory environment in cell therapy. Taking these factors into account, we are lowering our core revenue guidance range for 2025. To walk you through our updated guidance, we now expect core business revenue, which does not include SPL program-related revenue, to be flat to down 10 percent in 2025. representing approximately $29.5 to $32.5 million in 2025 revenue, compared to $32.5 million in 2024. This compares to our previous guidance range of 8% to 15% growth, or approximately $35 to $37 million. Both ranges include approximately $2 million in revenue from SecureDX, which we continue to expect. The change of the guidance midpoint is $5 million, relative to our previous plan. The first factor in the guidance reduction is about $1.5 million in PAs, relative to our prior plan. Half of this is a result of inventory management at the previously mentioned customer, and the other half is related to softness across other preclinical and clinical customers due to program consolidation. Additionally, about $2 million of the guidance reduction is related to licenses, relative to our prior plan. About a quarter of licenses' impact was from our largest customer reorganizing manufacturing operations, and about three-fourths is related to other clinical customers consolidating programs or shutting down operations. The remaining $1.5 million of the guidance cut is related to softness and instruments as customers remain hesitant with capital equipment purchases. As we look forward, we have had detailed discussions with this customer and can confirm that this is not a movement away from our platform or changes in outlook for their therapeutic. We are working with the customer to determine the timing of future purchases as they continue to optimize their manufacturing network. While we are disappointed in the change in expectations for this year, we remain confident in the value proposition that MaxSight offers to the cell and gene therapy industry. And based on the current opportunities in the pipeline, we expect to return back to growth in 2026. With such growth, including continued growth in Asia Pacific, an increasing number of clinical programs utilizing our platform, and the launch of a new platform later this year that we believe will add to our top-line growth. To cover our second quarter financial results and developments in more detail, we reported $8.5 million in total revenue, which included a core revenue of $8.2 million and SPL program-related revenue of $0.3 million, which was in line with our expectations. Within the core business, instrument install base grew to $814 as of June 30th, with instrument revenue of $2.1 million in the second quarter, which grew 22% year-over-year. While the capital equipment spending environment has not fully recovered, we are optimistic about the improved growth to instrument sales. License revenue was $2.6 million, which was flat year-over-year. PA or processing assembly revenue increased 5% year-over-year, stepping down slightly from recent quarters. License and PA revenue were impacted by some customers' consolidated programs. Turning to the SPL program-related line, revenue was $0.3 million in the quarter, representing revenue primarily from cash chevy commercial royalties, as we had not recognized any milestones during the quarter. During Vertex's second quarter earnings call, they highlighted the positive momentum they have seen with cash chevy worldwide, with an acceleration in patient initiations, cell collections, and number of patients completing their treatment journey. Vertex points to the progress they are making in 2025, as well as the growth CashServi positions them for in 2026. And they have met their goal of authorized treatment centers, or ATCs, with more than 75 ATCs activated globally. We are encouraged by their continued investment in their ATC network to be able to support the launch of this critical product. There are now 115 patients who have completed cell collection, with 29 patients now having completed their patient journey, which includes 16 in the second quarter, equating to $30 million in revenue for the second quarter for Vertex. Additionally, 250 patients have now been referred by physicians to activate treatment centers to initiate treatment. As patients' initiations and cell collections continue to ramp, Vertex expects commensurate increases in infusions, but noted that because the timing of infusions is predicated on patient scheduling choices, there may be revenue variability from quarter to quarter. We continue to believe that cash chevy interest and demand remains very high around the globe, and we are very excited by the truly transformative nature of the treatment. Over the last week, we were excited to sign two new SPL agreements with Adacet Bio and Anoka AB, bringing our total number of SPL agreements to 31. Adacet Bio, who is working to develop allogeneic gamma delta T cell therapies for cancer and autoimmune diseases, will utilize our expert platform to expand their manufacturing capabilities to include non-viral gene editing delivery. We are also excited to be supporting Anoka AB, a T-cell immunotherapy company developing a deep pipeline of T-cell receptor engineered therapies, or TCRs. MaxSight's platform will provide both companies with technical, scientific, and regulatory support as they advance their pipelines and missions forward. We view these new SPL signings and our continued ability to grow instrument placements in a difficult environment as a testament to the resilience of our platform as a protocol manufacturing tool for advanced therapies. To provide a better understanding of our SPL portfolio, we've added a new deck to our investor relations website, which we hope you will look through, highlighting the SPLs in our portfolio and their current clinical programs and progress. Our business model remains strong as we're continuing to sign new SPLs that will provide value over the near, mid, and long term. And our existing customer base continues to advance their respective research and clinical programs. As it stands today, 14 of our SPL clients have active programs in the clinic. while others are working on earlier programs. We are supporting a total of 18 active clinical programs, which is consistent with the beginning of the year. Given the dynamic environment this year, four clinical programs shut down, but four new programs entered the clinic, which is a testament to our strong business model. We expect that at times some of our SPL customers will rationalize programs, but our highly differentiated platform and unparalleled scientific support allows us to sign new SPLs, thereby continually increasing the number of clinical programs we support. Some of the 18 programs we support have also progressed further along in the clinic so far this year. To highlight the progress, five of the current 18 clinical programs are set to enter physical studies in the next six to 18 months. As I mentioned, while programs can fail or be slowed and deprioritized, that is the nature of the industry and built into our business model. We continue to sign new SPLs and have seen recent SPL signings result in new programs moving into clinical development. Since the IPO, The number of MaxSight SPL agreements and active clinical programs supported has grown substantially, and we've continued to see diversification in our clinical revenue compared to just a few years ago, with trials across a vast number of RSPLs, such as for blood cancer, solid tumor, genetic diseases, neurodegenerative diseases, and autoimmune diseases. Our differentiated platform, leading support, engineering know-how, and FDA master file have positioned MaxSight continue to sign three to five SPLs a year for the foreseeable future. As we look beyond cash chevy to the second wave of potential therapies coming to market, MaxSci supports five clinical programs that are expected to enter pivotal studies in the next six to 18 months and could be approved and launched in 2027 and 2028. Such approvals all provide us participation in the economics in the form of royalties, annual license fees, and significant expansion of processing assembly use. Our ability to disclose and discuss these programs is limited by confidential agreements with our customers. However, on slide eight of the new deck, we've detailed the five programs across five SPLs, CRISPR Therapeutics, Wuzhen, Imogene, Caribou, and one undisclosed SPL that we believe could enter pivotal studies within this timeframe. We also support 13 programs currently in phase one, which we believe have potential approvals beyond 2028, and another 19 programs currently in preclinical development with launch potential in 2032 and beyond. As you know, not every program will make it to FDA approval. However, we capture value from both successful programs and programs that do not achieve their endpoints. As we add SPLs and our existing SPLs bring more programs to the clinic, the opportunity set will continue to grow. Turning to our cell and gene therapy services, formerly under subsidiary SecureDX, which we have now merged into MaxSight, we are pleased with the performance of the business so far this year. remaining on track to meet our annual revenue expectation, and we are seeing good traction in booking projects. Since the acquisition earlier this year, we have been successfully integrating these services into MaxLight. The three assays available through SecureDX, screening, nomination, and confirmation, are available to both ex vivo and in vivo therapy developers at different stages in development, starting in the discovery stage through preclinical development and IND enabling studies. SecureDx provides a robust and efficient on- and off-target assessment and decreases time to clinic and improves likelihood of program success. In the evolving cell gene therapy industry, safety has become increasingly important from a regulatory perspective, and SecureDx gene editing risk assessment services align with regulatory guidance from the FDA and other agencies. We've seen positive momentum in the adoption of SecureDx technology in clinical studies. For instance, OneSeq, a technology invented by SecureDx, and GuideSeq, a technology invented by Mass General Hospital and licensed exclusively to SecureDx, were both used in the gene editing risk assessments performed by Children's Hospital Philadelphia and Penn in the first-of-its-kind personalized gene editing therapy approved by regulators and administered to the infant KJ for a rare genetic disease, which has received national coverage. We believe that the opportunity for SecureDx is very large, and not just in rare disease. SecureDx offers both off-target and off-target analysis to support gene knockouts and gene insertions in advanced therapies. The assays support early development to IND filings for both in vivo and ex vivo therapies, and we expect Secure's addressable market to be the entire field of modified cell gene therapies. We are very optimistic about the commercial opportunity for SecureDx and believe that it has significant growth potential over the coming years. The sales pipeline so far this year is more than twice as much as it was heading into 2025. Despite what remains a challenging backdrop in cell and gene therapy, we see vast potential for these therapies to provide life-changing treatments to patients challenged with disease, a belief that is shared across the industry landscape of regulators, academics, and drug developers. We were encouraged by the Cell and Gene Therapy Roundtable hosted by the FDA in June and subsequent commentary from leaders of the Department of Health and Human Services. In our view, the message was clear. It has become apparent that cell and gene therapy is a priority at the agency. They support increasing the focus on curative therapies while moving away from managing costly chronic diseases. They have committed to cell and gene therapy research and desire for payment reform and regulatory flexibility, and they have emphasized the need to accelerate cell and gene therapy development timelines. Over the long term, we share in the belief that cell and gene therapies have the potential to cure disease and reduce associated costs and patient burden. Maxar remains extremely well positioned to benefit for the growth of this industry over time. Given the long-term belief we have in the industry, we continue to make disciplined investments to position the company for the future. Our organic investments continue to be in new products and product enhancements, while our inorganic investment focus has been on solving critical pain points in the industry, as seen with SecureDX. We are able to invest in our business given the strength of the balance sheet, as well as our focus on driving growth with efficient and lean operations. Our management team is committed to carefully managing MagSight's financial health and continually evaluating ways to run our business more efficiently without sacrificing growth investments. With our existing balance sheet, MaxSight expects to achieve profitability without additional capital needs. To wrap up, I will highlight that we officially delisted from the AIM markets on June 26, following our annual meeting of stockholders, and are now solely listed on NASDAQ. We believe this was in the best interest of MaxSight and our stakeholders. We are thankful to our UK shareholders for their continued support. In summary, while I'm disappointed with the operational headwinds at our customers that have resulted in a reduced financial outlook for 2025, we are working diligently to build a growing and profitable business and position MaxSight for the future. My focus of growing MaxSight with multiple product offerings while improving operational efficiencies to reduce our annual burn to put us on track towards profitability remains solidly on track. We remain very optimistic and confident about MaxSight's position in cell and gene therapy And over time, we believe MaxSight's platforms and SPL business model will benefit from the growth of the industry. With that, I will now turn the call over to Doug to discuss our financial results. Doug?